The Roosevelt Hotel in New York – an entity owned by Pakistan International Airlines Investment Limited (PIAIL) – announced late Thursday that it would be ‘closing its doors permanently’ on October 31.
“Due to the current economic impacts, after almost 100 years of welcoming guests to The Grand Dame of New York, The Roosevelt Hotel is regretfully closing its doors permanently as of Oct 31, 2020,” the announcement of the website read.
The managing director of PIAIL had earlier stated that The Roosevelt remained profitable for 99 years and suffered a loss of only $1.5 million last year,
According to reports, financial experts would be hired to decide the future of the prestigious property in the heart of Manhattan and PIAIL is also looking into the matter.
In August it was reported that The Economic Coordination Committee (ECC) of the cabinet, was expected to approve funding of $125 million to PIAIL to rescue Roosevelt Hotel that has fallen into a debt trap and its assets are at risk.
Sources told The Express Tribune that the PIAIL chairman, in its letter sent on August 4, 2020, informed the Aviation Division that the financial health of PIA Corporation Limited (PIACL) neither permitted repayment of $50 million to PlAIL in the near future nor could it borrow any funds on account of a lack of cash flow and already pledged assets.
Therefore, according to the letter, the government of Pakistan has been requested to provide financing of $125 million urgently, enabling them to secure PIAIL’s most valuable asset.
The Aviation Division had earlier informed the economic decision-making body that in the backdrop of Covid-19 pandemic, the hotel industry had been severely impacted across the globe.
Roosevelt Hotel has experienced extreme cash flow constraints since March 2020.
The PIAIL chairman had provided detailed information in this regard pertaining to financial challenges being faced in running Roosevelt Hotel, a potential source of funds, union issues, future outlook and board’s decision for government’s consideration and action